Innovation Capability
Lesson 2.1 Innovation Capability
Innovation capability refers to an organization’s capacity to innovate; more specifically, it “refers to a firm’s ability to generate innovation through continuous learning, knowledge transformation, creativity, and exploitation of internal and external resources available to the firm” (Iddris 2016, P. 246). Accordingly, innovation capability is positively linked to organizational performance (Saunila et al., 2014; Aas & Breunig, 2017). To learn more, please watch this video by Dr. Dave Francis on the roots of innovation capability: https://vimeo.com/126670220.(video transcript available [NewTab])
When taking a closer look at innovation capability, the following elements, identified by Lawson and Samson (2001) and Saunila & Ukko (2012) stand out:
| Components of Innovation Capability | |
| Lawson and Samson (2001) |
|
|---|---|
| Saunila & Ukko (2012) |
|
Table 1. Elements of organizational Innovation Capability
Note that there are some elements that are consistent across both studies (such as creativity or idea generation). Where do you think these similarities and differences stem from? Perhaps the difference lies in the angle the authors have taken in their view of innovation capability where the former focuses on climate/setting of development of innovation capability, while the latter is result-orientated and focuses on outcomes that lead to innovation capability. Nevertheless, both studies highlight that the decision to develop innovation capability is rooted in organizational strategic direction, culture, and values. Although the decision to develop innovation capability starts from the key decision-makers within the organization, employees are key pillars in achieving it.
Application of Concepts
In what ways might organizations encourage employees to be creative and innovative? Can you think of any such approaches?
Feedback: How might job crafting be used as a tool to motivate employees to generate ideas, to be creative and to improve organizational performance? From example cases provided in section 1.2, you should now have a sense of how change in any of its forms and sizes can motivate individuals and have positive impact on performance, or how it can improve a workplace. Even failure of ideas can result in learning, and allows us to reevaluate and move forward in another direction.